Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets

v3.5.0.2
Intangible Assets
 9 Months Ended
Sep. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets
Intangible Assets
Our intangible assets include the following:
 
 
 
September 30, 2016
 
December 31, 2015
 
Weighted
Average
Useful Lives
 
Gross
Carrying
Value
 
Accumulated Amortization
 
Net Carrying
Value
 
Gross
Carrying
Value
 
Accumulated Amortization
 
Net Carrying
Value
Indefinite life intangible assets:
 
 
 

 
 

 
 

 
 

 
 

 
 

FCC licenses
Indefinite
 
$
2,083,654

 
$
—

 
$
2,083,654

 
$
2,083,654

 
$
—

 
$
2,083,654

Trademark
Indefinite
 
250,000

 
—

 
250,000

 
250,000

 
—

 
250,000

Definite life intangible assets:
 
 
 

 
 

 
 

 
 

 
 

 
 

Subscriber relationships
9 years
 
380,000

 
(358,140
)
 
21,860

 
380,000

 
(336,822
)
 
43,178

OEM relationships
15 years
 
220,000

 
(42,778
)
 
177,222

 
220,000

 
(31,778
)
 
188,222

Licensing agreements
12 years
 
45,289

 
(29,741
)
 
15,548

 
45,289

 
(26,977
)
 
18,312

Proprietary software
8 years
 
27,215

 
(19,298
)
 
7,917

 
27,215

 
(17,752
)
 
9,463

Developed technology
10 years
 
2,000

 
(1,633
)
 
367

 
2,000

 
(1,483
)
 
517

Leasehold interests
7.4 years
 
—

 
—

 
—

 
132

 
(132
)
 
—

Total intangible assets
 
 
$
3,008,158

 
$
(451,590
)
 
$
2,556,568

 
$
3,008,290

 
$
(414,944
)
 
$
2,593,346



Indefinite Life Intangible Assets
We have identified our FCC licenses and the XM trademark as indefinite life intangible assets after considering the expected use of the assets, the regulatory and economic environment within which they are used and the effects of obsolescence on their use.
We hold FCC licenses to operate our satellite digital audio radio service and provide ancillary services. The following table outlines the years in which each of our satellite licenses expires:
FCC satellite licenses
 
Expiration year
SIRIUS FM-1*
 
2017
SIRIUS FM-5
 
2025
SIRIUS FM-6
 
2022
XM-3
 
2021
XM-4
 
2022
XM-5
 
2018

* As of April 7, 2016, this satellite was no longer being used to transmit satellite radio.  We plan to complete the deorbiting of this satellite during the fourth quarter of 2016.
Prior to expiration of our FCC licenses, we are required to apply for a renewal of our FCC licenses.  The renewal and extension of our licenses is reasonably certain at minimal cost, which is expensed as incurred.  Each of the FCC licenses authorizes us to use the radio spectrum, which is a renewable, reusable resource that does not deplete or exhaust over time.
Our annual impairment assessment of our identifiable indefinite lived intangible assets is performed as of the fourth quarter of each year. An assessment is performed at other times if an event occurs or circumstances change that would more likely than not reduce the fair value of the asset below its carrying value. If the carrying value of the intangible assets exceeds its fair value, an impairment loss is recognized. As of September 30, 2016, there were no indicators of impairment, and no impairment loss was recorded for intangible assets with indefinite lives during the three and nine months ended September 30, 2016 and 2015.
Definite Life Intangible Assets
Amortization expense for all definite life intangible assets was $12,080 and $12,824 for the three months ended September 30, 2016 and 2015, respectively, and $36,778 and $39,068 for the nine months ended September 30, 2016 and 2015, respectively. Expected amortization expense for the remaining period in 2016, each of the fiscal years 2017 through 2020 and for periods thereafter is as follows:
Years ending December 31,
 
Amount
2016 (remaining)
 
$
11,767

2017
 
34,882

2018
 
19,463

2019
 
19,026

2020
 
18,446

Thereafter
 
119,330

Total definite life intangible assets, net
 
$
222,914